Proposal for a COUNCIL REGULATION on the application of Articles 93, 107 and 108 of the Treaty on the Functioning of the European Union to certain categories of State aid in the rail, inland waterway and multimodal transport sector
Date: 2022-07-06
Institutions: Directorate-General for Competition, European Commission
Subjects: State aid, aid system, aid to undertakings, combined transport, control of State aid, inland waterway transport, rail transport, services of general interest

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 6.7.2022  COM(2022) 327 final 2022/0209 (NLE)  Proposal for a COUNCIL REGULATION on the application of Articles 93, 107 and 108 of the Treaty on the Functioning of the European Union to certain categories of State aid in the rail, inland waterway and multimodal transport sector (Text with EEA relevance)  
 
EXPLANATORY MEMORANDUM 

CONTEXT OF THE PROPOSAL 

Reasons for and objectives of the proposal 

1. 

• 

Context 

As indicated by the Commission in its Annual Sustainable Growth Strategy 20211, measures 
addressing  transport  can  strongly  support  the  green  transition  by  bringing  significant 
greenhouse  gas  emission  reductions  and  improvements  to  air  quality,  while  fostering 
productivity growth and strengthening the resilience of industrial ecosystems. In that context, 
the  Commission  stressed  the  importance  of  investments  in  public  transport  and  in 
infrastructure that supports the shift towards more sustainable and smart mobility, including 
seamless  and  efficient  European  multimodal  networks  as  well  as  upgrading  the  Trans-
European Transport Network for passengers and freight. 

A well-functioning rail,  inland waterway and multimodal transport system is key to ensuring 
connectivity  across  Europe,  establishing  a  Single  European  Railway  Area,  fostering 
economic, social and territorial cohesion in line with Articles 170 and 174 of the Treaty on the 
Functioning  of  the  European  Union  (“TFEU”),  achieving  EU  climate  goals  (the  “European 
Green Deal”2) and supporting the resilience of the EU industry and its value chains (the “New 
Industrial  Strategy”  as  updated3),  including  the  ones  supporting  the  objectives  of  the  digital 
transformation and digitalisation (‘the European Digital Strategy’4). On 9 December 2020, the 
Commission  adopted  a  Communication  on its Sustainable  and  Smart  Mobility  Strategy  (the 
“Commission’s Sustainable and Smart Mobility Strategy”)5, in which the strengthening of rail 
and inland waterway transport, as well as multimodal transport, is an essential component of 
the green and digital transformation of European transport, which is in turn key to reach the 
Union’s goal of climate neutrality by 2050.  

Those  objectives  cannot  be  reached  without  major  investments  by  the  Member  States.  The 
range  of  investments  that  Member  States  may  consider  to  support  low-emission  transport 
modes  goes  from  investments  in  new  or  existing  fleet  to  investments  in  rail  infrastructure, 
transhipment terminals and maintenance workshops, also with a view to stimulating demand 
for a zero-emission fleet and for digital solutions that enable interoperability across transport 
modes  and  within  sectors.  This  calls  for  State  aid  rules  that  allow  those  investments  where 

1 
Communication from the Commission to the European Parliament, the European Council, the Council, 
the European Central Bank, the European Economic and Social Committee, the Committee of the Regions and 
the European Investment Bank — Annual Sustainable Growth Strategy 2021, COM/2020/575 final. 
2 
Communication  from  the  Commission  to  the  European  Parliament,  the  Council,  the  European 
Economic and Social Committee and the Committee of the Regions — The European Green Deal, COM(2019) 
640 final. 
3 
Communication from the Commission to the European Parliament, the European Council, the Council, 
the European Economic and Social Committee and the Committee of the Regions – ‘A New Industrial Strategy 
for Europe’, COM(2020) 102 final, 10 March 2020 as updated by Communication from the Commission to the 
European  Parliament,  the  Council.  The  European  Economic  and  Social  Committee  and  the  Committee  of  the 
Regions  -  "Updating  the  2020  New  Industrial  Strategy:  Building  a  stronger  Single  Market  for  Europe’s 
recovery’, COM(2021) 350 final. 
4 
Communication  from  the  Commission  to  the  European  Parliament,  the  Council,  the  European 
Economic  and  Social  Committee  and  the  Committee  of  the  Regions  –  ‘Shaping  Europe's  digital  future’, 
COM(2020) 67 final, 19 February 2020. 
5 
Communication  from  the  Commission  to  the  European  Parliament,  the  Council,  the  European 
Economic and Social Committee and the Committee of the Regions — Sustainable and Smart Mobility Strategy 
– putting European transport on track for the future, COM/2020/789 final, SWD(2020) 331 final. 

EN 

1 

  EN 

 
                                                 
such  public  support  is  necessary  while  preserving  and  enhancing  competition  in  rail, inland 
waterway and multimodal transport.  

Pursuant  to  Article  93  TFEU,  ‘Aids  shall  be  compatible  with  the  Treaties  if  they  meet  the 
needs  of  coordination  of  transport  or  if  they  represent  reimbursement  for  the  discharge  of 
certain obligations inherent in the concept of a public service’. Article 93 TFEU is included 
under  “Title  VI  –  TRANSPORT”,  whose  provisions  exclusively  apply  to  transport  by  rail, 
road and inland waterway, as laid down in Article 100(1) TFEU. The current proposal covers 
transport by rail and by inland waterway, including multimodal transport6.   

i) 

Aid that meets the needs of coordination of transport 
The  2008  Community  Guidelines  on  State  aid  for  railway  undertakings7  (“Railway 
Guidelines”)  aimed  at  codifying  and  updating  the  Commission’s  practice  concerning  the 
compatibility with the Treaty of aid to undertakings in the rail transport sector following the 
evolution of the sectorial legal framework, in particular to accompany the gradual opening of 
the  market  to  competition.  The  fitness  check8  of  State  aid  rules,  including  the  Railway 
Guidelines,  carried  out  in  2020  has  confirmed  the  need  for  a  revision  of  the  State  aid  rules 
applicable to rail, inland waterway and intermodal transport, given the major regulatory and 
market  developments  since  20089.  Against  that  background,  the  Commission  is  considering 
not  only  a  revision  of  the  Railway  Guidelines,  but  also  the  adoption  of  specific  block 
exemption rules to help rail, inland waterway and  multimodal transport (both passenger and 
freight services) embrace the green and digital transition.  

In particular, the Commission  aims to  increase legal  certainty and  reduce  the administrative 
burden in  relation to certain national aid measures supporting the modal  shift of freight and 
passengers  from  road  to  less  polluting  transport  modes  and  solutions,  which  are  designed, 
based on vast decisional practice by the Commission, in a way that ensures that competition 
distortions  are  limited.  Block  exemption  regulations  increase  legal  certainty  for  Member 
States and aid beneficiaries in terms of how measures should be designed. At the same time, 
they  simplify  procedures,  by  exempting  certain  measures  from  the  obligation  under  Article 
108(3)  TFEU  to  notify  State  aid  to  the  Commission  prior  to  its implementation,  where  it  is 
possible, based on the decisional practice of the Commission, to define ex ante compatibility 
conditions ensuring that potential competition distortions are limited.  

6 

’Multimodal transport' means the carriage of passengers or freight, or both, using two or more modes of 
transport, as defined in Regulation (EU) No 1315/2013 of the European Parliament and of the Council 
of 11 December 2013 on Union guidelines for the development of the trans-European transport network 
and repealing Decision No 661/2010/EU (OJ L 348, 20.12.2013, p. 1).  
Communication from the Commission — Community guidelines on State aid for railway undertakings 

7 
(“Railway Guidelines”) (OJ C 184, 22.7.2008, p. 13). 
8 
The findings of the fitness check of the railway guidelines conducted by the Commission in 2019 and 
2020  are  available  at:  https://ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/2044-Fitness-
check-of-2012-State-aid-modernisation-package-railways-guidelines-and-short-term-export-credit-insurance. 
9 
In particular, the Railway Guidelines predate the most recent (4th) railway package (2016), which will 
complete  the  liberalisation  and  market  opening  of  the  rail  sector  (https://transport.ec.europa.eu/transport-
modes/rail/railway-packages/fourth-railway-package-2016_en).  Other  legislative  developments  occurred,  e.g. 
the  revision  of  the  Eurovignette  Directive  (Directive  (EU)  2022/362  of  the  European  Parliament  and  of  the 
Council of 24 February 2022 amending Directives 1999/62/EC, 1999/37/EC and (EU) 2019/520,  as regards the 
charging  of  vehicles  for  the  use  of  certain  infrastructures,  OJ  L  69,  4.3.2022,  p.  1),  which  introduced  certain 
changes  to  the  charging  system  for  the  use  of  road  infrastructure.  This  may  in  turn  affect  the  way  costs 
differences between road and other modes of transport are calculated for the purpose of granting aid to promote 
the modal shift from road to less polluting transport modes.  

EN 

2 

  EN 

                                                 
 
The Commission  has gained significant  experience in  relation  to  aid  for  the coordination of 
transport covered by Section 6.3 of the Railway Guidelines as well as aid to support transport 
modes  and  solutions  that  are  less  polluting  and  more  sustainable  than  road-only  transport, 
including  aid  to  support  intermodal  transport10  and  inland  waterway  transport.  In  the 
Commission’s experience, aid for the coordination of transport is instrumental to modal shift 
and, under certain conditions, does not give rise to any significant distortions of competition. 
Moreover, a block exemption of aid for the coordination of transport has been widely called 
for by Member States. It is therefore appropriate to enable the Commission to block-exempt 
aid  provided  by  Member  States  in  support  of  those  measures,  where  certain  conditions  are 
fulfilled.  

The block  exemption  would cover measures which fall under Article 93 TFEU and  support 
the  shift  of  freight  and  passengers  from  more  polluting  transport  modes  (in  particular,  road 
transport) to  less polluting and more sustainable transport modes and solutions, in  line with 
the Commission’s decision-making practice. 

ii)   Aid that represents reimbursement for the discharge of certain obligations 

inherent in the concept of a public service 

As  regards  aid  for  the  discharge  of  certain  obligations  inherent  in  the  concept  of  a  public 
service (which is currently not covered by the Railway Guidelines), the Commission may also 
consider the possibility to block-exempt, under certain conditions, the compensation granted 
by Member States for the discharge of public service obligations in the rail, inland waterway 
and  multimodal  transport  sectors,  provided  it  is  not  covered  by  Regulation  (EC)  No 
1370/2007  of  the  European  Parliament  and  the  Council  of  23  October  200711  (Regulation 
(EC) No 1370/2007).  

In  particular,  as  regards  freight  transport,  public  service  obligations  may  be  an  appropriate 
instrument to promote services in areas and segments where otherwise freight transport would 
occur by road only.  

This  proposal  does  not  cover  aid  to  compensate  public  service  obligations  concerning 
passenger  transport  governed  by  Article  9(1)  of  Regulation  (EC)  No  1370/2007.  That 
provision exempts from the prior notification requirement public service compensation for the 
operation  of  public  passenger  transport  services  or  for  complying  with  tariff  obligations 
established through general rules and paid in accordance with Regulation (EC) No 1370/2007.  

Problem that the initiative aims to tackle 

There is a need for specific rules allowing for procedural simplification in relation to aid for 
rail, inland waterway and multimodal transport.  

Under  the  division  of  competences  between  the  Council  and  the  Commission  set  out  in 
Articles  108(4)  and  109  TFEU,  it  is  for  the  Council  to  determine  the  categories  of  aid  that 
may be exempted from State aid notification, and for the Commission to adopt the regulations 
laying down detailed rules relating to such exemption.  

10 

Intermodal  transport  means  a  movement  of  goods  (in  one  and  the  same  loading  unit  or  a  vehicle)  by 
successive  modes  of  transport  without  handling  of  the  goods  themselves  when  changing  modes.  It  is 
hence a type of multimodal transport (https://stats.oecd.org/glossary/detail.asp?ID=4303). 
11 
Regulation (EC) No 1370/2007 of the European Parliament and of the Council of 23 October 2007  on 
public passenger transport services by rail and by road and repealing Council Regulations (EEC) Nos 1191/69 
and 1107/70 (OJ L 351, 3.12.2007, p. 1). 

EN 

3 

  EN 

                                                 
By  way  of  block  exemption  regulations,  the  Commission  exempts  from  the  notification 
obligation  laid  down  in  Article  108(3)  TFEU  the  aid  measures  identified  by  the  Council, 
thereby  allowing  Member  States  to  directly  implement  them  without  prior  approval  by  the 
Commission.  

Council Regulation  (EU) 2015/1588  of 13 July  2015 on the application of Articles 107 and 
108  TFEU  to  certain  categories  of  horizontal  State  aid  (the  “2015  Enabling  Regulation”)12 
identifies  a  certain  number  of  categories  of  aid  that  may  be  exempted  by  the  Commission 
from  the  notification  obligation  laid  down  in  Article  108(3)  TFEU.  However,  the  2015 
Enabling  Regulation  covers  only  State  aid  measures  declared  compatible  with  the  internal 
market under Article 107(2) or 107(3) TFEU, but leaves uncovered the aid measures whose 
compatibility is assessed under Article 93 TFEU. 

Therefore,  the  Commission  considers  that  such  a  gap  should  be  filled  in  the  interest  of 
procedural  simplification  for  Member  States  that  set  up  State  aid  measures  for  rail,  inland 
waterway and multimodal transport. 

Since  State  aid  for  rail,  inland  waterway  and  multimodal  transport  falls  under  Article  93 
TFEU,  which  constitutes  a  lex  specialis  relative  to  Article  107(2)  and  (3)  TFEU,  a  specific 
enabling  Council  regulation  for  rail,  inland  waterway  and  multimodal  transport  seems  fully 
justified (“Transport Enabling Regulation”). In fact, Article 93 TFEU belongs to Title VI, of 
Part 3 of the TFEU, which concerns transport, and provides that State aid shall be compatible 
with  the  Treaties  if  it  meets  the  needs  of  coordination  of  transport  or  if  it  represents 
reimbursement  for  the  discharge  of  certain  obligations  inherent  in  the  concept  of  a  public 
service. Accordingly, compatibility of State aid with the internal market pursuant to Article 93 
TFEU  depends  on  verifying  whether  the  aid  pursues  those  objectives.  The  Commission’s 
block exemption regulation would lay down the relevant criteria to that end. 

The  present  proposal  aims  to  align  State  aid  rules  applicable  to  rail,  inland  waterway  and 
multimodal  transport  with  the  Commission’s  Sustainable  and  Smart  Mobility  Strategy. 
Pursuant  to  the Transport Enabling Regulation,  the Commission will be able to  adopt  block 
exemption regulations for aid under Article 93 TFEU involving a limited risk of competition 
and  trade  distortions.  This  proposal  enables  the  Commission  to  adopt  block  exemption 
regulations in areas where it has acquired sufficient experience to define clear compatibility 
criteria,  whilst  ensuring  that  the  effect  on  competition  and  trade  between  Member  States  is 
limited. 

The Transport Enabling Regulation will not have any direct impact itself but will constitute a 
legal  basis  for  the  adoption  of  possible  block  exemption  regulations.  The  Commission  will 
assess different policy options for any such block exemption regulations and their impacts in 
the context of an Impact Assessment, on the basis of the Transport Enabling Regulation. 

• 

Consistency  with  existing  policy  provisions  in  the  policy  area  and  with  other 
Union policies 

This proposal contributes to the overall objectives of the Union, in particular the objective of 
enforcement and simplification of State aid rules, on the one hand, and the implementation of 
the European Green Deal, on the other hand.  

12 OJ L 248, 24.9.2015, p. 1.  

EN 

4 

  EN 

                                                 
As regards the interest of enforcement of State aid rules, as indicated by the Commission in its 
Communication  on  State  aid  Modernisation  of  8  May  201213,  State  aid  enforcement  should 
focus on cases with the biggest impact on the internal market. This implies, on the one hand, 
stronger scrutiny of large and potentially distortive aid,  and, on the other hand, a simplified 
analysis of cases with only limited effect on trade and competition. The latter can be achieved 
by block-exempting those categories of aid from the notification requirement. 

As regards the interest in simplification of State aid rules, it is necessary to have a consistent 
approach in the procedures applicable to aid in the form of compensation for the discharge of 
public  service  obligations  in  both  passengers  and  freight  market  segments.  Article  9(1)  of 
Regulation No 1370/2007 already provides for the exemption from prior notification of public 
service  compensation  in  line  with  State  aid  rules  for  public  passenger  transport  services. 
However, a similar block exemption for public service compensation does not presently exist 
for  freight  transport.  Therefore,  aid  for  reimbursing  the  discharge  of  certain  obligations 
inherent  in  the  concept  of  a  public  service  with  regard  to  freight  transport  by  rail,  inland 
waterway or intermodal transport, as referred to in Article 93 TFEU, should be brought under 
the scope of a Transport Enabling Regulation.  

As  regards  its  contribution  to  the  European  Green  Deal,  this  proposal  will  facilitate  the 
promotion  of  a  green,  efficient  and  interconnected  multimodal  transport  system,  which  is  a 
necessary step towards the Union’s goal of climate neutrality by 2050. In that respect, there is 
a clear link between this proposal and the planned revision of the Railway Guidelines, as they 
are  both  meant  to  facilitate  the  public  financing  of  modal  shift  of  traffic  from  road  to  rail, 
inland waterway and more sustainable multimodal transport solutions, and ultimately support 
the green and digital transformation of European transport, while ensuring that distortions of 
competition remain limited. The proposed Transport Enabling Regulation would exempt from 
the notification obligation measures falling under Article 93 TFEU for which it is possible to 
define clear compatibility conditions.  

2. 

• 

LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY 

Legal basis 

The legal basis of this proposal is Article 109 TFEU, which allows the Council to make any 
appropriate  regulations,  in  particular  to  determine  the  conditions  in  which  Article  108(3) 
TFEU applies, and the categories of aid that may be exempted from that procedure.  

The Council’s competence to  take  any appropriate regulation  to  determine  the categories of 
aid  that  can  be  block-exempted,  as  set  out  in  Article  109  TFEU14,  relates  to  all  State  aid 
measures, including in relation to rail, inland waterway and multimodal transport, covered by 
Article 93 TFEU.  

• 

Subsidiarity and proportionality  

The proposal falls under the exclusive competence of the Union. Pursuant to Article 3 TFEU 
(‘The Union shall have exclusive competence in the following areas: [...] (b) the establishing 
of  the  competition  rules  necessary  for  the  functioning  of  the  internal  market’).  The 
subsidiarity principle therefore does not apply.  

13 
COM(2012) 209 final. 
14 
‘The Council, on a proposal from the Commission and after consulting the European Parliament, may 
make any appropriate regulations for the application of Articles 107 and 108 and may in particular determine the 
conditions in which Article 108(3) shall apply and the categories of aid exempted from this procedure’. 

EN 

5 

  EN 

                                                 
The proposal does not go beyond what is necessary to achieve its objective, which is to 
enable  the  Commission  to  block-exempt  aid  for  the  coordination  of  transport 
and aid for the reimbursement for the discharge of certain obligations inherent 
in the concept of a public service, provided that certain conditions are fulfilled. 
Therefore, the proposal complies with the proportionality principle.• Choice  of 
the instrument 

The proposed instrument is that of a Council regulation.  

Under Article 109 TFEU, a regulation is the only legal instrument available to the Council to 
determine  the  conditions  in  which  Article  108(3)  TFEU  applies,  and  the  categories  of  aid 
exempted from that procedure. 

3. 

• 

RESULTS 
CONSULTATIONS AND IMPACT ASSESSMENTS 

EX-POST 

EVALUATIONS, 

OF 

STAKEHOLDER 

Ex-post evaluations/fitness checks of existing legislation 

The conclusion of the fitness check of the Railway Guidelines is that those guidelines need a 
full-fledged review to align them with the market and regulatory developments as well as with 
the  new  overarching  priorities  set  out  in  the  Green  Deal  Agenda.  Among  others,  the  fitness 
check pointed to the appropriateness of a block exemption in particular for several types of aid 
for  the  coordination  of  transport  that  have  been  approved  by  the  Commission  over  the  last 
decade by way of decisions not to raise objections15, without a formal investigation procedure 
having  been  carried  out.  More  specifically,  the  evaluation  of  Section  6.3  of  the  Railway 
Guidelines, concerning aid for the coordination of transport, showed that all cases resulted in 
decisions not to raise objections, generally within limited time from the notification16.   

The  fitness  check  of  the  Railway  Guidelines  was  built  on  a  comprehensive  review  of  the 
Commission’s State aid  decisions  approved  under the Railway Guidelines and/or Article 93 
TFEU,  feedback  received  from  Member  States  and  stakeholders  in  the  open  public 
consultation. The need for a Transport Enabling Regulation is even more pressing in the light 
of the European Green Deal and the increased importance of a modal shift to more sustainable 
transport modes, such as rail, inland waterway and multimodal transport, in order to meet the 
emissions reduction target by 2050.  

• 

Stakeholder consultations 

This proposal does not require any stakeholder consultation. 

The  proposed  Transport  Enabling  Regulation  will  per  se  not  have  any  direct  impact  on 
stakeholders, because it will merely provide a legal basis for the Commission to adopt block 
exemption  regulations.  In  the  light  of  the  technical  nature  of  this  proposal,  which  is  merely 
preparing  the  ground  for  future  block  exemption  regulations,  no  public  consultation  will  be 
carried  out.  However,  on  1  October  2021  the  Commission  published  a  roadmap  concerning 

15 
See Article 4(3) of Council Regulation (EU) 2015/1589 of 13 July 2015 laying down detailed rules for 
the application of Article 108 of the Treaty on the Functioning of the European Union (OJ L 248, 24.9.2015, p. 
9). 
16 
See  the  Commission  Staff  Working  Document  –  Fitness  Check  of  the  2012  State  aid  modernisation 
package, railways guidelines and short-term export credit insurance {SEC(2020) 372 final} - {SWD(2020) 258 
final},  part  3/4,  p.  139  and  fn.  211,  available  at  https://ec.europa.eu/info/sites/default/files/fitness_check_-
_annexes_part3_en.pdf.  

EN 

6 

  EN 

                                                 
specifically  the  initiative  to  develop  the  present  proposal.  Stakeholders  had  four  weeks  to 
provide feedback on the roadmap17.  

A  public  consultation  will  be  conducted  for  the  revision  of  the  Railway  Guidelines,  which 
includes the project to simplify the rules on State aid for coordination of transport by way of a 
block  exemption  regulation.  A  specific  public  consultation  will  also  be  carried  out  for  the 
future Commission’s block exemption regulations. 

• 

Impact assessment 

There is no need to support this proposal by an impact assessment. This proposal aims at the 
adoption  by  the  Council  of  a  Transport  Enabling  Regulation,  which  will  allow  the 
Commission  to  adopt  block  exemption  regulations  for  aid  for  rail,  inland  waterway  and 
multimodal  transport  involving  a  limited  risk  of  trade  and  competition  distortions.  This 
proposal does not entail any immediate block exemption of the aid categories covered by the 
envisaged  Transport  Enabling  Regulation,  rather  it  enables  the  Commission  to  adopt  block 
exemption regulations at a subsequent stage.   

The contents of the future Commission block exemption regulations will be underpinned by 
an impact assessment.  

• 

Regulatory fitness and simplification 

This  proposal  aims,  among  other  things,  to  simplify  existing  rules  on  State  aid  for 
coordination  of  transport  and  on  State  aid  representing  reimbursement  for  the  discharge  of 
public service obligations in the rail, inland waterway and  multimodal transport sectors, and 
reduce the number of State aid notifications and the related regulatory costs.  

The  proposed  Transport  Enabling  Regulation  enables  the  Commission  to  adopt  block 
exemption  regulations  for  aid  for  rail,  inland  waterway  and  multimodal  transport.  The 
adoption  of  such  block  exemption  regulations  will  bring  benefits  to  the  Union  as  a  whole. 
First,  it  will  foster  a  fundamental  green  and  digital  transformation  of  European  transport  in 
line with the policy objectives set out in the European Green Deal. Second, it will noticeably 
reduce  the  administrative  burden  and  cost  for  investments  in  low-emission  transport  modes 
and  for  the  consolidation/expansion  of  existing  transport  modes  and  solutions  less  polluting 
than  road  transport.  Third,  it  will  simplify  the  clearance  of  aid  for  the  discharge  of  certain 
obligations  inherent  in  the  concept  of  a  public  service  and  support  cleaner  transport  modes 
and solutions in areas and segments, where transport would otherwise occur by road only. 

• 

Fundamental rights 

This proposal has no consequences for the protection of fundamental rights.  

17 
transport-simplified-state-aid-rules-New-Land-Transport-Enabling-Regulation-_en.   

https://ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/13153-Greener-land-

See 

EN 

7 

  EN 

                                                 
4. 

BUDGETARY IMPLICATIONS 

THE PROPOSAL HAS NO NEGATIVE IMPLICATIONS FOR THE UNION BUDGET.5.  OTHER 

ELEMENTS 

• 

Implementation plans and monitoring, evaluation and reporting arrangements 

The  proposed  Transport  Enabling  Regulation  will  be  binding  in  its  entirety  and  directly 
applicable in all Member States upon its entry into force.  

Pursuant  to  Article  6  of  the  proposed  Transport  Enabling  Regulation,  the  Commission  will 
submit  every  five  years  a  report  to  the  European  Parliament  and  to  the  Council  on  the 
application of the Transport Enabling Regulation. Moreover, a draft report will be submitted 
in advance for consideration to the Advisory Committee on State aid referred to in Article 5 
of  the  proposed  Transport  Enabling  Regulation.  Pursuant  to  Article  5(1)  of  the  proposed 
Transport  Enabling  Regulation,  that  committee  will  also  be  consulted  by  the  Commission 
when  it  intends  to  adopt  a  block  exemption  regulation  and  before  adopting  any  such 
regulation.    

• 

Detailed explanation of the specific provisions of the proposal 

Article  1(1)  of  the  proposed  Transport  Enabling  Regulation  identifies  two  categories  of  aid 
exempted  from  notification  under  Article  108(3)  TFEU:  (i)  aid  for  the  coordination  of 
transport; and (ii) aid for the reimbursement for the discharge of certain obligations inherent 
in  the  concept  of  a  public  service.  Those  categories  reflect  the  scope  of  Article  93  TFEU. 
However, the scope of the proposed  Transport Enabling  Regulation does not  include public 
service  compensation  for  the  operation  of  public  passenger  transport  services  or  for 
complying  with  tariff  obligations  established  through  general  rules,  covered  by  Regulation 
(EC) No 1370/2007.  

Article  1(2)  of  the  proposed  Transport  Enabling  Regulation  indicates  the  elements  that  the 
Commission  will  specify  in  its  subsequent  regulations  to  block-exempt  from  notification 
under  Article  108(3)  TFEU  the  above  categories  of  aid.  Those  categories  are  the  same  as 
those identified in the 2015 Enabling Regulation.  

Article 1(3) of the proposed Transport Enabling Regulation indicates the type of conditions 
that, in its subsequent block exemption regulations, the Commission may specify in order to 
ensure the compatibility  with  the internal market of aid covered by the present  proposal.  In 
particular, Article 1(3)(b) allows the Commission to exclude certain sectors from the scope of 
the block exemption regulations. That provision takes into account that this proposal enables 
the Commission to adopt block exemption regulations as it acquires sufficient experience to 
define  clear  compatibility  criteria,  whilst  ensuring  that  the  effect  on  competition  and  trade 
between Member States is limited.  

As  regards  transparency  and  monitoring,  the  period  of  validity  and  the  amendment  of 
regulations,  the  hearing  of  interested  parties,  the  Advisory  Committee  on  State  aid  and  its 
consultation,  and  the  evaluation  report,  Articles  2  to  6  of  the  proposed  Transport  Enabling 
Regulation reflect the provisions of the 2015 Enabling Regulation. 

EN 

8 

  EN 

2022/0209 (NLE) 

Proposal for a 

COUNCIL REGULATION 

on the application of Articles 93, 107 and 108 of the Treaty on the Functioning of the 
European Union to certain categories of State aid in the rail, inland waterway and 
multimodal transport sector 

(Text with EEA relevance) 

THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  on  the  Functioning  of  the  European  Union,  and  in  particular 
Article 109 thereof, 

Having regard to the proposal from the European Commission, 
Having regard to the opinion of the European Parliament18,  

Whereas: 

(1) 

Council Regulation (EU) 2015/158819 empowers the Commission to declare by means 
of regulations that certain specified categories of aid are compatible with the internal 
market  and  are  exempted  from  the  notification  requirement  of  Article  108(3)  of  the 
Treaty.  While  Regulation  (EU)  2015/1588  covers  certain  categories  of  aid  to 
undertakings  operating  in  different  sectors,  such  as  aid  in  favour  of  environmental 
protection, it does not cover, among others, aid to support transport by rail and inland 
waterway, including multimodal transport20. The rail, inland waterway and multimodal 
transport sectors  have become increasingly relevant  at  Union level,  in  the context  of 
the  European  Green  Deal21,  and  the  Commission’s  Sustainable  and  Smart  Mobility 
Strategy 22. 

(2) 

Pursuant  to  Article  93  of  the  Treaty,  aid  in  relation  to  rail,  inland  waterway  and 
multimodal  transport,  meeting  the  needs  of  coordination  of  transport  or  representing 

18 
OJ C , , p. . 
19 
Council Regulation (EU) 2015/1588 of 13 July 2015 on the application of Articles 107 and 108 of the 
Treaty  on  the  Functioning  of  the  European  Union  to  certain  categories  of  horizontal  State  aid  (OJ  L  248, 
24.9.2015,  p. 1).  Council  Regulation  (EU)  2015/1588  repealed  Council  Regulation  (EC)  No  994/98 of  7  May 
1998  on  the  application  of  Articles  92  and  93  of  the  Treaty  establishing  the  European  Community  to  certain 
categories of horizontal State aid (OJ L 142, 14.5.1998, p.1). 
20 
’Multimodal transport' means the carriage of passengers or freight, or both, using two or more modes of 
transport,  as  defined  in  Regulation  (EU)  No  1315/2013  of  the  European  Parliament  and  of  the  Council  of  11 
December 2013 on Union guidelines for the development of the trans-European transport network and repealing 
Decision No 661/2010/EU (OJ L 348, 20.12.2013, p. 1–128). 
21 
Communication  from  the  Commission  to  the  European  Parliament,  the  Council.  The  European 
Economic and Social Committee and the Committee of the Regions — The European Green Deal, COM(2019) 
640 final. 
22 
Communication  from  the  Commission  to  the  European  Parliament,  the  Council.  The  European 
Economic and Social Committee and the Committee of the Regions — Sustainable and Smart Mobility Strategy 
– putting European transport on track for the future, COM/2020/789 final, SWD(2020) 331 final. 

EN 

9 

  EN 

                                                 
(3) 

(4) 

(5) 

reimbursement  for  the  discharge  of  certain  obligations  inherent  in  the  concept  of  a 
public service, is to be compatible with the Treaties. 

The Commission has applied Article 93, Article 107(1) and Article 108 of the Treaty 
in numerous decisions concerning certain categories of State aid to undertakings active 
in  the  rail,  inland  waterway  and  intermodal  transport  sectors  and  has  developed 
guidelines for the purpose of assessing certain categories of State aid that are deemed 
to  meet  the  needs  of  transport  coordination23.  In  the  Commission’s  experience,  such 
aid  does  not  give  rise  to  any  significant  distortion  to  competition,  provided  that  it  is 
granted  based  on  open,  transparent  and  non-discriminatory  procedures  and  clear 
compatibility conditions can be defined on the basis of the experience acquired.   

Therefore,  with  a  view  to  simplifying  administration  in  cases  where  distortion  to 
competition  is  limited  to  a  minimum,  the  Commission  should  be  empowered  to 
declare  by  means  of  regulations,  that  aid  for  the  coordination  of  transport  or 
reimbursement  for  the  discharge  of  certain  obligations  inherent  in  the  concept  of  a 
public service as referred to in Article 93 of the Treaty is compatible with the internal 
market  and  is  exempted  from  the  notification  requirements  of  Article  108(3)  of  the 
Treaty. 

State aid representing reimbursement for the discharge of public service obligations in 
relation to public passenger transport services is already covered by Regulation (EC) 
No  1370/2007  of  the  European  Parliament  and  of  the  Council,  including  where 
Member States decide to apply that Regulation to public passenger transport by inland 
waterways  and  national  sea  waters,  in  accordance  with  Article  1(2)  of  that 
Regulation24.  Public  service  compensation  concerning  public  passenger  transport 
should therefore be excluded from the scope of this Regulation. 

(6)  When  adopting  regulations  exempting  certain  categories  of  aid  from  the  notification 
requirements  set  out  in  Article 108(3) of the Treaty (‘block exemption  regulations’), 
the Commission should specify the purpose of the aid, the categories of beneficiaries 
and thresholds limiting the exempted aid, the conditions governing the cumulation of 
aid  and  the  conditions  of  monitoring,  and  attach  any  further  detailed  conditions  in 
order  to  ensure  the  compatibility  with  the  internal  market  of  aid  covered  by  this 
Regulation. 

(7) 

It  is  important  for  all  parties  to  be  able  to  check  whether  an  aid  is  granted  in 
compliance with the applicable rules. Transparency of State aid is, therefore, essential 
for  the  correct  application  of  Treaty  rules  and  leads  to  better  compliance,  greater 
accountability,  peer  review  and  ultimately  more  effective  public  spending.  For  that 
reason,  Member  States  should  be  required  to  provide  summaries  of  information 
concerning  aid  implemented  by  them,  which  is  covered  by  a  block  exemption 
regulation. In order to ensure the transparency of the measures adopted by the Member 
States those summaries should be published by the Commission. 

(8) 

Pursuant  to  Article  108(1)  of  the  Treaty  the  Commission  is  to  keep  under  constant 
review  all  existing  systems  of  aid,  in  cooperation  with  the  Member  States.  For  that 
purpose  and  in  order  to  ensure  the  largest  possible  degree  of  transparency  and 
adequate control, the Commission should ensure that Member States record and store 

Communication  from  the  Commission  -  Community  guidelines  on  State  aid  for  railway  undertakings 

23 
(OJ C184, 22.7.2008, p. 13). 
24 
Regulation (EC) No 1370/2007 of the European Parliament and of the Council of 23 October 2007  on 
public passenger transport services by rail and by road and repealing Council Regulations (EEC) Nos 1191/69 
and 1107/70 (OJ L 351, 3.12.2007, p. 1). 

EN 

10 

  EN 

                                                 
information  about  the  application  of  the  block  exemption  regulations  adopted  by  the 
Commission. The Commission should also ensure that Member States provide it with 
a  report,  at  least  on  an  annual  basis,  on  the  application  of  such  block  exemption 
regulations. Those reports should be accessible to all Member States. 

(9) 

Before  adopting  block  exemption  regulations  pursuant  to  this  Regulation,  the 
Commission should enable all interested parties to submit their comments in order to 
gather feedback which is as comprehensive and as representative as possible. For that 
purpose it should publish a draft of such block exemption regulations.  

(10)  The  Advisory  Committee  on  State  aid,  established  by  Article  7  of  Regulation  (EU) 
2015/1588,  should  be  consulted  at  the  same  time  as  the  publication  of  a  draft 
regulation.  However,  in  the  interest  of  transparency,  the  draft  regulation  should  be 
published  on  the  website  of  the  Commission  at  the  same  time  as  the  Commission 
consults the Advisory Committee for the first time  

(11)  The control of the granting of aid involves factual, legal and economic issues of a very 
complex  nature  and  great  variety  in  a  constantly  evolving  environment.  The 
Commission should therefore regularly review the categories  of aid  which should be 
exempted from notification. To that end, it should submit an evaluation  report to the 
European Parliament and the Council every five years, 

HAS ADOPTED THIS REGULATION: 

Article 1 

Block exemptions 

1. 

The  Commission  may,  by  means  of  regulations  adopted  in  accordance  with  the 
procedure laid down in Article 5, declare that the following categories of aid, within 
the meaning of Article 107(1) of the Treaty, are compatible with the internal market 
and are not subject to the notification requirements of Article 108(3) of the Treaty: 

(a) 

(b) 

aid for the coordination of transport; 

aid  for  reimbursement  for  the  discharge  of  certain  obligations  inherent  in  the 
concept of a public service, excluding public service compensation in relation 
to public passenger transport services, which is covered by Regulation (EC) No 
1370/2007.  

2. 

Regulations adopted pursuant to paragraph 1 shall specify for each category of aid: 

(c) 

the purpose of the aid;  

(d) 

the categories of beneficiaries;  

(e) 

thresholds  expressed  either  in  terms  of  aid  intensities  in  relation  to  a  set  of 
eligible costs or in terms of maximum aid amounts, or, for certain types of aid 
where  it  may  be  difficult  to  identify  the  aid  intensity  or  amount  of  aid 
precisely,  in  particular  financial  engineering  instruments  or  risk  capital 
investments  or  those  of  a  similar  nature,  in  terms  of  the  maximum  level  of 
State  support  in  or  related  to  that  measure,  without  prejudice  to  the 
qualification  of  the  measures  concerned  in  the  light  of  Article  107(1)  of  the 
Treaty;  

(f) 

the conditions governing the cumulation of aid;  

EN 

11 

  EN 

 
(g) 

the transparency and monitoring conditions in compliance with Article 2. 

3. 

In addition, regulations adopted pursuant to paragraph 1 may, in particular:  

(h) 

(i) 

(j) 

set  thresholds  or  other  conditions  for  the  notification  of  awards  of  individual 
aid;  

exclude certain sectors from their scope; 

attach  further  conditions  for  the  compatibility  of  aid  exempted  under  such 
regulations. 

4. 

5. 

6. 

7. 

8. 

9. 

Article 2 

Transparency and monitoring 

Regulations  adopted  pursuant  to  Article  1(1)  shall  include  detailed  rules  to  ensure 
transparency and monitoring of aid covered by those regulations.   

Where  Members  States  implement  aid  schemes  or  individual  aid  exempted  from 
notification pursuant to regulations referred to in Article 1(1), they shall forward to 
the Commission, with a view to publication, summaries of the information regarding 
such aid.  

Member States shall record and compile all the information regarding the application 
of  the  regulations  adopted  pursuant  to  Article  1(1).  Where  the  Commission  has 
information which provides reasons to believe that a regulation adopted pursuant to 
Article 1(1) is not being applied properly, the Member States shall forward to it any 
information that the Commission considers necessary to assess whether aid  granted 
under that regulation complies with all its conditions.  

At least  once  a  year, Member States shall supply the Commission  with  a report on 
the  application  of  the  regulations  adopted  pursuant  to  Article  1(1),  in  accordance 
with the Commission’s specific requirements, preferably in computerised form. The 
Commission  shall  make  those  reports  accessible  to  all  the  Member  States.  The 
Committee referred to  in  Article 5 shall examine and evaluate those reports once  a 
year. 

Article 3 

Period of validity and amendment of regulations 

Regulations  adopted  pursuant  to  Article  1(1)  shall  specify  their  period  of  validity. 
The regulations shall provide for a transitional period in case their period of validity 
is not extended when they expire. 

Where  regulations  adopted  pursuant  to  Article  1(1)  are  repealed  or  amended  by  a 
new  regulation,  the  new  regulation  shall  provide  for  a  transitional  period  of  six 
months  to  allow  for  the  adjustment  of  aid  covered  by  the  repealed  or  amended 
regulation. 

Article 4 

Hearing of interested parties 

Before the adoption of a regulation pursuant to Article 1(1), the Commission shall 
publish a draft thereof to enable all interested persons and organisations to submit 
their comments within a time limit fixed by the Commission. That time limit shall 

EN 

12 

  EN 

be at least one month, except where the Commission deems it appropriate to set a 
shorter deadline. 

Article 5 

Consultation of the Advisory Committee on State aid 

10. 

The  Commission  shall  consult  the  Advisory  Committee  on  State  aid  (the 
‘Committee’):  

11. 

12. 

13. 

14. 

(k) 

at the same time as draft regulations are published pursuant to Article 4; and 

(l) 

before adopting any regulation pursuant to Article 1(1).  

Consultation  of  the  Committee  shall  take  place  at  a  meeting  called  by  the 
Commission by means of electronic communication. The drafts and documents to be 
examined shall be annexed to the electronic communication. The meeting shall take 
place  no  earlier  than  two  months  after  the  electronic  communication.  That  period 
may  be  reduced  in  the  case  of  the  consultations  referred  to  in  paragraph  1,  where 
justified  for  reasons  of  urgency  or  for  the  extension  of  the  date  of  application  of  a 
regulation.   

The representative of the Commission  shall submit  to  the Committee a draft of the 
measures to be taken. The Committee shall deliver its opinion on the draft, within a 
time limit which the chairman may lay down according to the urgency of the matter, 
where necessary by taking a vote. 

The  opinion  of  the  Committee  shall  be  recorded  in  the  minutes.  In  addition,  each 
Member State shall have the right to ask to have its position recorded in the minutes. 
The  Committee  may  recommend  the  publication  of  the  opinion  in  the  Official 
Journal of the European Union.  

The Commission shall take into account the opinion delivered by the Committee. It 
shall inform the Committee of the manner in which its opinion has been taken into 
account. 

Article 6 

Evaluation report 

Every five years the Commission shall submit a report to the European Parliament and to the 
Council on the application of this Regulation. It shall submit a draft report for consideration 
by the Committee referred to in Article 5. 

Article 7 

Entry into force 

This Regulation shall enter into force on the twentieth day following that of its publication in 
the Official Journal of the European Union. 

EN 

13 

  EN 

This Regulation shall be binding in its entirety and directly applicable in all Member States. 

Done at Brussels, 

For the Council 
The President 

EN 

14 

  EN